Feeds

C&W claims IBM price gouging

'significant levels of overcharging'

  • alert
  • submit to reddit

Secure remote control for conventional and virtual desktops

Cable & Wireless has brought a lawsuit against IBM for what it calls "substantial overcharging" by the IT services company.

In the Cable & Wireless 2003 annual report published on Friday, the telecom said the legal action relates to a global IT services deal it signed with IBM back in December 2000.

As part of the deal, Cable & Wireless was to conduct regular benchmarking exercises to monitor elements like price and service levels provided by IBM. In a benchmark conducted in February 2002, Cable & Wireless said it discovered "significant levels of overcharging by IBM."

Ever since that benchmark was completed last spring, the companies have been in dispute over its results and over whether IBM should repay the amount it was deemed to have overcharged. Mediation failed to resolve the dispute and Cable & Wireless is now seeking damages.

According to the annual report, Cable & Wireless claims it was overcharged by £115 million in respect of its UK operations and $22 million in the US, and those numbers continue to rise for each month that IBM refuses to drop its charges, the telecoms firm said. IBM has lodged counter-claims, including an action by IBM Japan which alleges that it is due money from Cable & Wireless. A court date for a trial in connection with the overcharging accusations has been set for this September.

The annual report also revealed a number of ongoing legal actions against Cable & Wireless by companies in the US and Central America, including a suit by two companies in Panama. The plaintiffs, who had been seeking damages for up to $125 million, claimed that Cable & Wireless had breached its contract terms.

The court agreed that the telecoms firm had failed to "maintain in sufficient confidence" certain proprietary information of the plaintiffs and ordered the telecom to pay $67.3 million in damages. Cable & Wireless said it is appealing the judgement and has not paid any of the damages.

© ENN

Secure remote control for conventional and virtual desktops

More from The Register

next story
Ex-US Navy fighter pilot MIT prof: Drones beat humans - I should know
'Missy' Cummings on UAVs, smartcars and dying from boredom
Facebook, Apple: LADIES! Why not FREEZE your EGGS? It's on the company!
No biological clockwatching when you work in Silicon Valley
The 'fun-nification' of computer education – good idea?
Compulsory code schools, luvvies love it, but what about Maths and Physics?
Doctor Who's Flatline: Cool monsters, yes, but utterly limp subplots
We know what the Doctor does, stop going on about it already
'Cowardly, venomous trolls' threatened with TWO-YEAR sentences for menacing posts
UK government: 'Taking a stand against a baying cyber-mob'
Happiness economics is bollocks. Oh, UK.gov just adopted it? Er ...
Opportunity doesn't knock; it costs us instead
Sysadmin with EBOLA? Gartner's issued advice to debug your biz
Start hoarding cleaning supplies, analyst firm says, and assume your team will scatter
prev story

Whitepapers

Forging a new future with identity relationship management
Learn about ForgeRock's next generation IRM platform and how it is designed to empower CEOS's and enterprises to engage with consumers.
Cloud and hybrid-cloud data protection for VMware
Learn how quick and easy it is to configure backups and perform restores for VMware environments.
Three 1TB solid state scorchers up for grabs
Big SSDs can be expensive but think big and think free because you could be the lucky winner of one of three 1TB Samsung SSD 840 EVO drives that we’re giving away worth over £300 apiece.
Reg Reader Research: SaaS based Email and Office Productivity Tools
Read this Reg reader report which provides advice and guidance for SMBs towards the use of SaaS based email and Office productivity tools.
Security for virtualized datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.